Middle Eastern investments in London’s most in-demand office spaces are set to reach up to $2.5bn (£2bn) this year, according to a report by real estate broker Knight Frank. It identified 80 global investors that have set aside $6.2bn to invest in London offices.
A real estate environment of lower prices, high rental growth and lower borrowing costs has drawn in the interest of Gulf investors. The most in-demand offices are modern, centrally located and environmentally efficient workspaces in the UK capital.
Borrowing costs for top London assets have decreased by 5.5 per cent from a 2022 peak of 7 per cent. The last few years have seen 77 per cent of office renters not renew their leases, as opposed to around 50 per cent over the past 25 years. The broker suggests this evidences a push towards greater demand for high-quality spaces.
The UK Government has welcomed Middle Eastern investments as it tries to reinvigorate the country’s stricken economy.
